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Exam 9: Individuals As the Taxpayer

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Question 1

True/False

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The additional standard deduction for age and blindness is greater for married taxpayers than for single taxpayers.

A) True
B) False

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False

Question 2

Multiple Choice

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Regarding the Tax Tables applicable to the Federal income tax, which of the following statements is correct?

A) For any one year, the Tax Tables are issued by the IRS after the Tax Rate Schedules.
B) The Tax Tables will always yield the same amount of tax as the Tax Rate Schedules.
C) Taxpayers can elect as to whether the use the Tax Tables or the Tax Rate Schedules.
D) The Tax Tables can be used by an estate but not by a trust.
E) No correct answer given.

F) A) and D)
G) A) and C)

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Question 3

Multiple Choice

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In which, if any, of the following situations will the kiddie tax not apply?

Regarding the tax formula and its relationship to Form 1040, which, if any, of the following statements is correct?

In terms of the tax formula applicable to individual taxpayers, which, if any, of the following statements is correct?

Benjamin, age 16, is claimed as a dependent by his parents.During 2018, he earned $850 at a car wash.Benjamin's standard deduction is $1,400 $1,050 + $350).

During 2018, Lisa age 66) furnished more than 50% of the support of the following persons: ∙ Lisa's current husband who has no income and is not claimed by someone else as a dependent. ∙ Lisa's stepson age 19) who lives with her and earns $6,000 as a dance instructor.He dropped out of school a year ago. ∙ Lisa's ex-husband who does not live with her.The divorce occurred two years ago. ∙ Lisa's former brother-in-law who does not live with her. Presuming all other dependency tests are met, on a separate return how many dependents may Lisa claim?

The phaseout of the AMT exemption amount for a taxpayer filing as a head of household both begins and ends at a higher income level than it does for a single taxpayer.

The basic and additional standard deductions both are subject to an annual adjustment for inflation.

Clara, age 68, claims head of household filing status.If she has itemized deductions of $18,900 for 2018, she should claim the standard deduction.

Which, if any, of the statements regarding the standard deduction is correct?

After her divorce, Hope continues to support her ex-husband's sister, Cindy, who does not live with her.Hope can claim Cindy as a dependent.

Ed is divorced and maintains a home in which he and a dependent friend live.Ed does not qualify for head of household filing status.

All exclusions from gross income are reported on Form 1040.

Kyle and Liza are married and under 65 years of age.During 2018, they furnish more than half of the support of their 19-year old daughter, Kendra, who lives with them.She graduated from high school in May 2017.Kendra earns $15,000 from a part-time job, most of which she sets aside for future college expenses.Kyle and Liza also provide more than half of the support of Kyle's cousin who lives with them.Liza's father, who died on January 3, 2018, at age 90, has for many years qualified as their dependent.How many dependents can Kyle and Liza claim?

A decrease in a taxpayer's AGI could increase the amount of medical expenses that can be deducted.

In determining the filing requirement based on gross income received, both additional standard deductions i.e., age and blindness) are taken into account.

Derek, age 46, is a surviving spouse.If he has itemized deductions of $26,250 for 2018, Derek should not claim the standard deduction.

Buddy and Hazel are ages 72 and 71 and file a joint return.If they have itemized deductions of $25,100 for 2018, they should not claim the standard deduction.

Certain high-income individuals are subject to three additional Medicare taxes-on wages, unearned income, and tax credits claimed.